! year fixed ISA

Kim_13

PaulDesmond said:

Okay thanks. Got it. There is one odd thing.

When I went to money facts and clicked on 1 year fixed ISA. There were 5 banks. Could I put £3k into one and 3 months later put £3k into another and so on as they are all diffrent companies? I can not put another £3k ino the same account.

HMRC now allow more than one cash ISA per tax year, so £3K with one bank and £3K with another a few months later if you wish. You can add to the same ISA if you go with one of the providers that allow funding through the term, Kent Reliance and Shawbrook. Suffolk Building Society and Dudley Building Society allow funding to the end of this tax year and I believe Lloyds allow 90 days. Rates may be lower than other providers with more limited funding windows, though.

LHW99

Just remember - approach your new ISA provider(s) and ask them to transfer the money from the old fixed rate one. That way a) the money never goes somewhere that it could be taxed and b) money from last financial year (April 24 to April25) can be transferred, and doesn't affect the amount you can add in 2025-26.

If you did actually withdraw it, then not only can tax be due afterwards, but putting it back into an ISA means it becomes part of this year's £20k ISA allowance (there are some flexible ISA's where that doesn't happen, but I don't think fixed rate ones allow it).

Albermarle

PaulDesmond said:

I would need to withdraw after 1 year and then re-invest in another 1 or 2 year fixed rate ISA.

What would hapen to it after the 1 year if it is left in. I would be getting 4.52% for this 1 year.

There is a sub forum for ISA's. It would probably be a good idea to have a good read through that.
ISAs & tax-free savings — MoneySavingExpert Forum

Kim_13

LHW99 said:

Just remember - approach your new ISA provider(s) and ask them to transfer the money from the old fixed rate one. That way a) the money never goes somewhere that it could be taxed and b) money from last financial year (April 24 to April25) can be transferred, and doesn't affect the amount you can add in 2025-26.

If you did actually withdraw it, then not only can tax be due afterwards, but putting it back into an ISA means it becomes part of this year's £20k ISA allowance (there are some flexible ISA's where that doesn't happen, but I don't think fixed rate ones allow it).

Fixed rate ones don't, but if the transfer takes place before the fixed rate period has ended, there will be a penalty for the early withdrawal. Penalties aren't calculated on pro rata basis, so accidentally making a mistake at the end of a fix would be penalised disproportionately. I prefer to have my fixes morph into an Easy Access ISA with the existing provider first (whether this is automatic or requires instructions to be submitted for it) before initiating a transfer to another provider.

bsms1147

Ayr_Rage said:

(ISAs and their interest, dividends and capital gains ARE NEVER TAXABLE.

Not strictly true. You can hold overseas shares in a S&S ISA but often will have to pay a withholding tax on dividends.

Ayr_Rage

bsms1147 said:

Ayr_Rage said:

(ISAs and their interest, dividends and capital gains ARE NEVER TAXABLE.

Not strictly true. You can hold overseas shares in a S&S ISA but often will have to pay a withholding tax on dividends.

Is that really a UK tax?

Eco_Miser

Ayr_Rage said:

bsms1147 said:

Ayr_Rage said:

(ISAs and their interest, dividends and capital gains ARE NEVER TAXABLE.

Not strictly true. You can hold overseas shares in a S&S ISA but often will have to pay a withholding tax on dividends.

Is that really a UK tax?

No. Equally, interest, dividends and capital gains in ISAs are taxable if the holder is liable to tax on their global income in another country, notably the USA.